Topics in the News: Flat Tax

How do we win elections? In the contrast between corrupt Washington and the American people, we stand with the American people. We stand with a straight-forward and bold and positive agenda to inspire the young, to inspire women, to inspire Hispanics--
to inspire everybody.

Defend the Constitution--all of it.

We need to abolish the IRS. We need to adopt a simple flat tax.

We need to expand energy in this country and expand high-paying jobs all over America.

We need to expand school choice.

We need to repeal Dodd-Frank.

We need to audit the Federal Reserve.

We need to pass a strong balanced budget amendment.

We need to repeal every single word of ObamaCare.

We need to stop the lawlessness [of
Obama and ObamaCare].

We need to end the corruption.

A friend of mine suggested a bumper sticker slogan, "Republicans, we waste less." You win elections by standing for principle, inspiring people that there is a better tomorrow.

Although much of Carson's speech focused on personal responsibility, he offered two concrete policy ideas. The first is a flat tax. The Bible endorses the idea, Carson explained.
Everyone should tithe--give 10 percent--in good times and bad. It doesn't have to be 10 percent, he conceded. It's the principles of proportionality and simplicity that matter.

Critics complain that the poor guy who puts in $1 will be hurt more than the rich guy who puts in $1 billion. But, Carson asks: "Where does it say you've got to hurt the [rich] guy?
He just put a billion dollars in the pot. We don't need to hurt him. It's that kind of thinking that has resulted in 602 banks in the Cayman Islands."

Q: What is the highest federal income tax any American should have to pay? We are looking for a number.

PERRY: Seven percent flat tax. Simple. Keep it simple.

SANTORUM: Well, my plan has two rates, 10 and 28 percent, which is the highest rate under
Ronald Reagan when he cut taxes.

ROMNEY: I would like 25 percent, but right now it's at 35, so people better pay what is legally required. But ultimately let's get it down to as low as we possibly can, if it's 20, if it's 25 but paying more than
25 percent, I think, is taking too much out of our pockets.

GINGRICH: I would like to see it be a flat tax at 15 percent and I would like to see us reduce government to meet the revenue, not raise revenue to meet the government.

PAUL: Well, we should have the lowest tax that we've ever had, and up until 1913 it was 0%. What's so bad about that?

Newt Gingrich on Tax Reform
: Jan 16, 2012Flat tax at 15%; reduce government to make that work

Q: What is the highest federal income tax any American should have to pay? We are looking for a number.

PERRY: Seven percent flat tax. Simple. Keep it simple.

SANTORUM: Well, my plan has two rates, 10 and 28 percent, which is the highest rate under
Ronald Reagan when he cut taxes.

ROMNEY: I would like 25 percent, but right now it's at 35, so people better pay what is legally required. But ultimately let's get it down to as low as we possibly can, if it's 20, if it's 25 but paying more than
25 percent, I think, is taking too much out of our pockets.

GINGRICH: I would like to see it be a flat tax at 15 percent and I would like to see us reduce government to meet the revenue, not raise revenue to meet the government.

PAUL: Well, we should have the lowest tax that we've ever had, and up until 1913 it was 0%. What's so bad about that?

Mitt Romney on Tax Reform
: Jan 16, 2012Reduce top income tax from 35% to 25%

Q: What is the highest federal income tax any American should have to pay? We are looking for a number.

PERRY: Seven percent flat tax. Simple. Keep it simple.

SANTORUM: Well, my plan has two rates, 10 and 28 percent, which is the highest rate under
Ronald Reagan when he cut taxes.

ROMNEY: I would like 25 percent, but right now it's at 35, so people better pay what is legally required. But ultimately let's get it down to as low as we possibly can, if it's 20, if it's 25 but paying more than
25 percent, I think, is taking too much out of our pockets.

GINGRICH: I would like to see it be a flat tax at 15 percent and I would like to see us reduce government to meet the revenue, not raise revenue to meet the government.

PAUL: Well, we should have the lowest tax that we've ever had, and up until 1913 it was 0%. What's so bad about that?

Q: What is the highest federal income tax any American should have to pay? We are looking for a number.

PERRY: Seven percent flat tax. Simple. Keep it simple.

SANTORUM: Well, my plan has two rates, 10 and 28 percent, which is the highest rate under
Ronald Reagan when he cut taxes.

ROMNEY: I would like 25 percent, but right now it's at 35, so people better pay what is legally required. But ultimately let's get it down to as low as we possibly can, if it's 20, if it's 25 but paying more than
25 percent, I think, is taking too much out of our pockets.

GINGRICH: I would like to see it be a flat tax at 15 percent and I would like to see us reduce government to meet the revenue, not raise revenue to meet the government.

PAUL: Well, we should have the lowest tax that we've ever had, and up until 1913 it was 0%. What's so bad about that?

Andrew Cuomo on Tax Reform
: Jan 4, 2012A flat tax is not a fair tax

We fought for tax fairness. For decades, millions of New Yorkers were burdened with an unfair tax code. Whether a person made $20,000 or $20 million, they paid the same rate. It was just wrong--because a flat tax is not a fair tax. We added new brackets
for the middle class and for high earners. The more you make, the higher rate you pay. And we stimulated our economy by cutting taxes for New Yorkers earning $40,000 to $300,000. Today, the middle class is paying the lowest rate in 58 years.

Click for Andrew Cuomo on other issues.
Source: 2012 New York State of the State Address

In 1995-96, Mitt seriously explored the possibility of taking on Kerry. Had he run and lost, his political career could have ended right there. However, he backed off when the popular GOP governor Bill Weld decided to challenge Kerry (Weld lost).
Romney's most notable political action of the year may have been the series of full-page ads he took out during the 1996 primary election season blasting Republican presidential candidate Steve Forbes's "flat tax" proposal as unfair to the middle class.

Click for Mitt Romney on other issues.
Source: An Inside Look, by R.B. Scott, p. 81

Q: You don't have a flat tax. You're proposing to preserve the Bush-era tax rates. What is wrong with the idea that we should go to one rate? Why do you believe in a progressive tax system?

ROMNEY: Well, I would like to see our tax rates flatter. I'd
like to see our code simpler. I'd like to see the special breaks that we have in the code taken out. That's one of the reasons why I take the corporate rate from 35% down to 25%, is to take out some of the special deals. What I want to do is to take our
precious dollars & focus them on the people in this country that have been hurt the most, and that's the middle class. The Obama economy has really crushed middle-income Americans. So what I do is focus a substantial tax break on middle-income Americans.
Ultimately, I'd love to see us come up with a plan that simplifies the code and lowers rates for everybody. But right now, let's get the job done first that has to be done immediately. Let's lower the tax rates on middle-income Americans.

HUNTSMAN: We need something that's doable, doable, doable. And what I have put forward is a tax program that is doable. It actually wipes clean all of the loopholes and the deductions. This is right out of what the
Simpson-Bowles commission recommended--a bipartisan group of people that took a thoughtful approach to tax for corporate and individual,
and on the corporate side, phase out all of the corporate welfare, all of the subsidies because we can't afford it any longer; in a revenue-neutral fashion, buy down the rate from
35% to 25%, leveling the playing field for businesses big and small, allowing us to be a whole lot more competitive in the second decade of the 21st century.

Mitt Romney on Budget & Economy
: Sep 22, 2011Obama economy hurt middle class the most, so help them first

CAIN: [to Romney] : My 9-9-9 plan starts with throwing out the current tax code and pass 9% business flat tax, 9% personal income tax, and the 9% national sales tax.
It eliminates or replaces the corporate income tax, personal income tax, capital gains tax as well as the estate tax. And unlike Gov. Romney's plan my plan throws out the old one. He's still hooked to the current tax code. That dog won't hunt.

ROMNEY: My intent is to help the people who have been most hurt by President Obama's economy. And the people who have been most hurt are the middle income families of America. And that's why my plan says that if middle income families want to save their
money, anybody earning under $200,000 and not pay any taxes on interest, dividends or capital gains, zero tax on their savings, that's the plan I'm for. And I will get that done in my first year.

CAIN: [to Johnson] : My 9-9-9 plan starts with throwing out the current tax code and pass 9% business flat tax, 9% personal income tax, and the 9% national sales tax.

JOHNSON: Throwing out the entire federal tax system and replacing it
with a consumption tax, the FairTax, which would absolutely reboot the American economy because it does away with the corporate tax to create tens of millions of jobs in this country.

Q: With regards to jobs, how are you going to turn this country around?

A: My next-door neighbor's dogs have created more shovel-ready jobs than this current administration. Balance the federal budget now, not 15 years from now, not 20 years from now,
but now. And throw out the entire federal tax system, replace it with a FairTax, a consumption tax, that by all measurements is just that. It's fair. It does away with corporate income tax. [That would] create tens of millions of jobs in this country.

ROMNEY: The idea of a national sales tax or a consumption tax has a lot to go for it. One, it would make us more competitive globally, as we send products around the world, because under the provisions of the World Trade
Organization, you can reimburse that to an exporter. We can't reimburse our taxes right now. It also would level the playing field in the country, making sure everybody is paying some part of their fair share. But the way the fair tax has been structured
it has a real problem and that is it lowers the burden on the very highest income folks and the very lowest and raises it on middle income people. And the people who have been hurt most by the economy are the middle class. And so my plan is for
middle income Americans, no tax on interest, dividends or capital gains. Let people save their money as the way they think is best. We're taxing too much, we're spending too much and middle income Americans need a break and I'll give it to them.

Instead of nibbling around the edges of a job-killing tax code, we need to throw it out. Eliminate income, business and payroll taxes altogether, and replace them with a FAIR tax (FairTax.org) that will result in millions of jobs.
Instead of spending more, balance the budget now. Get the burden of government spending and borrowing off the economy, and it will flourish.
And as the government's chief executive, the President needs to get federal agencies out of the business of managing the economy, and into the business of establishing regulatory certainty.
Do those things, and the U.S. will become the job magnet of the world.

Q: You told the Wall Street Journal last year that you support means testing for Social Security, for which you said you would raise the eligibility age.

A: I would cut Social Security by raising the retirement age and have common sense means testing
that's fair. I would scrap the entire federal tax system and replace it with the FairTax--a one-time consumption tax, with no more Medicare and unemployment payroll deductions--so we'd replace all federal taxes, abolishing the IRS.

Click for Gary Johnson on other issues.
Source: Interview by Scott Holleran on scottholleran.com blog

Q: Can a president create jobs without expanding the role of the federal government?

A: As I proved in NM, government creates jobs by reducing its role, not expanding it. Get government out of the way. Government can create certainty.
Something that is completely lacking at the moment. Eliminate the cooperate income tax completely and adopt what is being called the Fair Tax: a one-time federal consumption tax.

At a NH campaign event, Huntsman said that as Utah governor, "We got a flat tax out of it; we cut income taxes by 30%; it was cost-neutral; we took out the deductions. And you know what? The state came to life in part because of that.''

How accurate is
that claim? Huntsman's campaign explained that when Huntsman took office, there were six income tax brackets ranging from 2.3% to 7%. Ultimately, Huntsman and the Legislature approved a single rate of 5%. They created a much flatter tax, stripping away
most of the deductions and credits. In general, most taxpayers ended up paying less in taxes.

Did Huntsman "cut income taxes by 30%"? We find that is a significant exaggeration: The statutory top tax bracket before and after the tax system declined fro
7% to 5%, which is a decrease of 28.6%. But that doesn't address the lower tax brackets. Remember, the lowest rate went up from 2.3% to 5%, but they got some tax credits. So Huntsman's 30 percent decrease in the statutory rate didn't apply to them.

The Road Map plan simplifies both the personal & corporate tax code. As individuals, we could choose between the current tax code and a simplified two-level flat tax. The simplified plan would tax the first $50,000 of individual income at 10%. All income
above $50,000 would be taxed at 25%. There are no taxes on interest, capital gains, dividends, no AMT, and no "death taxes."

The new, simplified tax code eliminates nearly all existing tax deductions and exclusions, but it allows generous standard
deductions and personal exemptions. Individuals receive a $12,500 deduction. Personal exemptions allow $3,500 for each family member. Tax return could be done on a post card.

The Road Map plan would not require major changes in the current income tax
system now collected by employers. People who don't like the simplified tax alternative could stay with the current tax system. This gives people a choice, and the total tax revenue to the government would be the same. Who could complain about that?

Mike Huckabee on Social Security
: Jan 24, 2008Will try to fix Social Security with FairTax

We’re in trouble is because we have a smaller group of people paying into the Social Security system, fewer wage earners, more Americans getting their wealth from dividends and from investments. I’m a strong supporter of the Fair Tax is that you
suddenly have a different funding stream for Social Security. It comes out of the general fund. So you now have a more reliable, a more stable and a much broader funding system that will supply Social Security.

In a lengthy exchange, Huckabee praised the FairTax, saying: “For each third of the economy, there is a benefit, about a 14% benefit for those at the bottom; those in the middle, about a 7%; even those at the very top end of the economy end up with about
a 5% benefit.”

Huckabee’s claim that everyone will pay less is a fantasy. The FairTax claims to be revenue neutral. That means that it has to collect the same $2.4 trillion that the current system collects. And remember that the
FairTax replaces corporate income and payroll taxes. That means that individuals have to pony up to replace those in addition to replacing the sums collected via personal income and payroll taxes.

So Huckabee is suggesting that the
FairTax will generate exactly the same revenue while collecting nothing from corporations and still costing everyone less than they are currently paying. We certainly hope Huckabee has a barrel of magic pixie dust buried somewhere.

Huckabee said about the FairTax, “Everybody gets in the economy--no more underground economy. Drug dealers, prostitutes, pimps, gamblers, non-Republicans--all of those people out there will be paying taxes. Nobody’s working under the table.”

Huckabee’s suggestion that the FairTax will end the underground economy is highly unlikely. It’s true that pimps and drug dealers will now be taxed when they spend their earnings. But will they really charge johns and junkies sales tax on their purchases
It’s a better deal for the person buying the sex or drugs, and a worse deal for the person selling it.

In fact, far from ending the underground economy, there is a real possibility that the FairTax will feed it growth hormones.
There would probably be two prices--one you can pay with a check or credit card that includes the FairTax and one you can pay in cash & save 23%. Because there would no longer be any audits of income, tracing such tax evasion would be extremely difficult

Mike Huckabee on Tax Reform
: Jan 24, 2008FairTax will tax the average American much less

Q: How does that help the 93 percent of Americans who are paying 15% or less right now?

A: They’re not paying 15 percent; that’s in their visible tax in the terms of the takeout from their checks. When you include the built-in tax, the embedded tax
in the products we buy that corporations build in, the average American is paying 33% in his or her taxes. It would be a dramatic difference if the taxpayers got to choose the taxes, which they would do under the FairTax.

Mike Huckabee on Tax Reform
: Jan 24, 2008FairTax and its prebate untax the poor and the elderly

People would love to see the IRS abolished. The harder you work, the more you earn, the more the IRS and the government wants from you. What the FairTax does is says, we want you to earn; we want you to save and we want you to buy things and sell things
and make a profit. It goes to the common sense of the idea that we should encourage people to work and get something for it. A lot of people have never read the entire FairTax because when I first heard about the FairTax, the consumption tax, quite
frankly it sounds like it would be oppressive and regressive to the poor. The poor come out best of all because of the provision in the FairTax called the prebate in which every American, each month, is given the amount of the FairTax back up to the
level of poverty. Everybody gets it, not just those under the level of poverty. It actually untaxes the poor, untaxes the elderly. It makes sure that we don’t end up paying taxes on groceries and medicine and the basic necessities of life.

Four out of five Americans would like to have the option of a one-page tax form with a single tax rate. This concept of an optional flat tax rate was developed by Steve Forbes when his flat tax campaign was undermined by criticisms that it would take
away popular tax breaks. Forbes proposed giving American taxpayers an opportunity to choose simplicity versus complexity and a single rate over a lot of deductions. They call it the free choice flat tax, and it's an idea whose time has come.

All workers and corporations would have the freedom to choose each year to file their income taxes either under the new free choice flat tax option or under the current US income tax code.

Rhode Island adopted an optional flat tax, and lawmakers there expect that it will make the state more competitive with neighboring states in attracting new business and entrepreneurs who create jobs.

Over 80 percent of the American people know that the tax code is irreparably broken. I would lead one to a FairTax, and that means that the rich people aren’t going to be made poor, but maybe the poor people could be made rich.
That ought to be the goal of any tax system--not to punish somebody, but to enable somebody so that they can have a part of the American dream. The FairTax does just that.

Huckabee claimed he would get rid of the IRS, a disappearing act that isn’t so easy as he makes it sound. Huckabee said, “The first thing that I would get rid of would be the Internal Revenue Service--a $10-billion-a-year industry.
I’m not being facetious. If we enacted the FairTax, we will get rid of the IRS.”

It is true that the FairTax would get rid of the agency that we now call the IRS. But, according to the bill Huckabee supports, the Fairtax would “eliminate” the
IRS by replacing it with a new Sales Tax Bureau, which wouldn’t necessarily be much smaller than the existing IRS.

According to the Bush administration study on the FairTax, “The federal administrative burden for a retail sales tax may be similar to
the burden under the current system.” The FairTax would also require an entirely new type of bureaucracy to “keep track of the personal information that would be necessary to determine the size of the taxpayer’s cash grant.”

Q: This would be a sales tax of 23% on almost every good and service you buy or anyone buys. But a bipartisan panel named by President Bush say to raise enough money, the rate would have to be
34%.

A: They didn’t really study the FairTax. They simply studied a type of consumption tax, not the actual proposal that was designed by some of the leading economists in this country. It is a rate of 23%. It’s not 30% or 34%,
as some of the critics complain.

Q: They said that a FairTax would reduce the tax burden on only two groups, those making less than $30,000 a year, because there’s a rebate for people under the poverty line, and those making more than $200,000 a year.
So the rich and the poor do better, but the vast middle class ends up paying more taxes.

A: They had a fatal flaw. They didn’t understand that the “prebate” applies to everybody, including the middle class. Everybody comes off better off.

Q: Tell us about your FairTax. You’re going to get rid of the IRS. You’re going to have basically a consumer tax. If you put a tax on spending, won’t that encourage people to hoard their money rather than spend it, and hurt the economy?

HUCKABEE: Nothing’s going to discourage Americans from spending money! No, the FairTax does something that is absolutely phenomenal for the economy. It untaxes productivity. It untaxes those things which we export.

Q: You may be the biggest supporter of the FairTax on this stage, that you say replace the income tax with a 23% national sales tax. Now, back in 2005, Pres. Bush’s Tax Reform Commission did a study about the FairTax. They said the sales tax rate would
have to be 34%, not 23%, & that no state, no country, has ever put in a 34% sales tax. The commission says that with a FairTax that high, there are only two income groups that would benefit--those making less than $30,000 a year & those making more than
$200,000.

A: The Bush tax panel did not look at the FairTax proposal. They looked at something that called itself that, but it was not. The true FairTax proposal is the 23%. And it empowers everyone in the economy, not just the people at the bottom
and the very top, but all of the middle class, which is a desperate need. What we would do with the FairTax is to eliminate all the taxes on productivity. You wouldn’t be penalized for saving, earning, for having a capital gain, making an investment.

Voters want somebody who talks about true tax reform like the fair tax. They embrace that idea in
New Hampshire when I talk about it--a complete just gutting of this incredibly complex and arcane tax code we have and replace it with a simple consumption tax that really elevates our economy, gives it a fresh start.

Q: The FairTax would eliminate the income tax, estate tax, payroll tax and capital gains tax and replace it with a 23% sales tax. Do you support it?

A: I absolutely support the FairTax.
And part of the reason is, the current system is one that penalizes productivity. If we could have the FairTax, you take $10 trillion parked offshore, bring it home, you rebuild the “Made in America” brand, you free up people to earn money, to work,
you don’t penalize them for taking a second job, you don’t penalize them for investing, you don’t penalize them for savings.

Today, our tax system doesn’t need a tap of the hammer, a twist of the screwdriver, it needs a complete overhaul. And what the
FairTax does, it ends the underground economy. No more illegals, no more gamblers, prostitutes, pimps and dope dealers will be able to escape the tax code. It’s the single great thing that will help this country [achieve a] revitalized economy.

Q: The FairTax would eliminate the income tax, estate tax, payroll tax and capital gains tax and replace it with a 23% sales tax. Do you support it?

A: It’s good, but it’s not that good. There are a lot of features that are very attractive about a
FairTax. Getting rid of the IRS is something we’d all love. But the truth is, we’re going to have to pay taxes. Completely throwing out our tax system and coming up with an entirely new one is something we have to do very, very carefully.
The president’s commission on tax reform looked at this and said: Not a good idea. Some of the reasons are the FairTax, for instance, charges a 23% tax, plus state sales tax, on a new home, when you purchase a new home. But if you buy an old home,
there’s no tax. Think what that might do to the construction industry. We need to thoroughly take it apart before we make a change of that nature. That’s why my view is, get rid of the tax on savings and let middle-income people save their money tax-free

Q: The alternative minimum tax caught 4 million people this year; it’ll get 23 million next year unless Congress acts. How would you eliminate the tax without raising the budget deficit?

A: The simplest way is an active FairTax. That’s the first thing
I’d love to do as president, put a “Going Out of Business” sign on the Internal Revenue Service and stop the $10 billion a year that it costs just for them to operate. A FairTax would eliminate the alternative minimum tax [& many other taxes].

Click for Mike Huckabee on other issues.
Source: 2007 Republican Debate in South Carolina

Huckabee praised a “FairTax” without noting that it would actually impose a stiff retail sales tax & ease the tax burden on the richest Americans:

“A FairTax would eliminate the alternative minimum tax, personal income tax, corporate tax, & al
the various taxes that are hidden in our system & Americans don’t realize what they’re paying.”

The FairTax proposes a “prebate” to soften its impact on low-income persons--a monthly check for the amount of tax paid up to the poverty level.
But any sales tax also would lower taxes for those upper-income persons who save large portions of income that would be taxed under current law.

Pres. Bush’s bipartisan Advisory Panel on Tax Reform rejected the idea, saying it would substantially
increase taxes for 80% of taxpayers. The panel calculated that a sales tax would have to be set at 34% of retail prices, and the monthly cash prebate would amount to the largest entitlement program in history, at least $600 billion per year.

A: I cut taxes 94 times as governor, but I realize tinkering with it doesn’t work. I’d overhaul it. I would work for the fair tax, which meets the four criteria:
flatter, fairer, finite, family friendly. We’d get rid of the IRS. We’re get rid of all capital gains, income, corporate. And we’d have a consumption tax. The fair tax proposal, I believe, offers the best opportunity for all levels of Americans.

During the 2000 presidential race, Steve Forbes advocated simplification of the tax code and the implementation of a flat tax. While far from perfect, moving toward a tax that is both flatter and fairer is a goal we should adopt.

One of the arguments
for a flat tax is to address a world economy that has radically changed in the last decade. Capital, and even labor, are fluid & mobile. A tax structure that is more predictable, consistent, flatter, and fairer not only represents greater accountability
in government but may well be a key element of economic survival as we continue to play on a global stage. Governments unwilling to respond with lower rates and broader tax bases are tempting fate and could continue to see erosion of investment & jobs.

Some argue that a flat tax is especially oppressive to those at the bottom of the economy because they currently pay little of their income to taxes. Making sure that a tax system is fair means we should not ignore the needs of the poor.

A better tax system will be more understandable and predictable for taxpayers, so they know how much tax they’re paying & why, and what government is doing with those dollars.

A better tax system will be more fair, balancing citizens’ ability
to pay and the cost and benefits of the government services they consume, and building confidence that the tax laws are being applied evenhandedly to all.

A fair tax system will eliminate unfunded mandates by assigning tax responsibility to the same
level of government that defines what levels of service will be provided.

A better tax system will be modern, reflecting the economy, technology, and society of the 21st century so we can raise sufficient revenue to meet future needs, be competitive
with other states and countries and incorporate new technology and ways of doing business.

And finally, a better tax system will just make sense, with tax laws that don’t undermine citizens and communities from doing the right things.

Click for Jesse Ventura on other issues.
Source: The Big Plan: Service, not Systems